Fractal Solutions

Fractal Solutions is taking the lead in South Africa by researching and exploring blockchain technology for the market.

As a division of Strate, Fractal Solutions is responsible for both evolutionary and revolutionary innovation that is set to create a paradigm shift in the financial services arena. The market is already being shaped by the rise of blockchain / distributed ledger technology, cryptocurrencies, and Initial Coin Offerings, and this fintech disruption is a key focus for Fractal Solutions.

An electronic voting solution for shareholder meetings using blockchain technology is going to be introduced to South Africa's financial markets. The envisaged blockchain-based solution will answer many shareholder and issuer' frustrations, as it will eliminate the current manual processes that are prone to errors, as well as the barriers to shareholder participation in decision-making at meetings, including annual general meetings (AGMs).

Blockchain can provide the market an end-to-end, secure, and reliable solution. It provides an immutable record with a cryptographically secure ledger of transactions and we are able to secure a vote in the blockchain in a far more efficient and user-friendly manner than any other technology that we have in existence.

For all shareholders, both local and foreign, it is important that the voting process is streamlined and transparent and that the meeting results are reported precisely, quickly and with guaranteed finality, so that the results can be relied on in a legally-binding way. The use of e-Voting would enable the shareholder to submit a vote online using an authorised login. This will be automatically processed, removing the potential for human error and giving the company voting results in real-time, enhancing corporate governance as a result.

The Distributed Organisation and Token Sales

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Innovation in the distributed organisation is being shaped by the excitement over the fast-evolving future of technology.

Initial Coin Offerings (ICOs) are increasingly used by businesses and individuals as a means to raise capital, as they are seen as a viable alternative to formal capital market structures.

In an ICO, tokens (specific to the ICO) are sold to any person on a virtual platform mainly by using other cryptocurrencies. These tokens are used to raise capital to fund the development of digital platforms, software, or other projects and may entitle the owners of the tokens to access the platform, use the software, or otherwise participate in the project. In some ICOs, the tokens promise a return on investment or the right to participate in a share of the returns provided by the project. Once issued, the tokens may be traded in a secondary market on virtual currency exchanges or other platforms.

ICOs are usually accompanied by a white paper, which outlines the project and how the funds will be used. The white paper is comparable to a prospectus for a new share issuance.

For more information on the distributed organisation and ICOs, email fractalsolutions [at] strate.co.za.

Thought leadership articles

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Below, you can access various third-party industry articles that highlight market developments and trends: